A Study on TQM Development, Performance and Sustenance in Service Industries through Effective Communication, Critical Success Factors and Market Orientation

VIVA-Tech International Journal for Research and Innovation Volume 1, Issue 4 (2021)
ISSN(Online): 2581-7280
VIVA Institute of Technology
9th
National Conference on Role of Engineers in Nation Building – 2021 (NCRENB-2021)
G-114
www.viva-technology.org/New/IJRI
A Study on TQM Development, Performance and Sustenance in
Service Industries through Effective Communication, Critical
Success Factors and Market Orientation
Suneet Mehta1
1
(Department of Mechanical Engineering, VIVA Institute of Technology/Mumbai University, India)
Abstract : Total Quality Management (TQM) is a management philosophy which focuses on customer
satisfaction by improving the organisation performance through co-ordination of various processes in all the
business units. The purpose of TQM is to provide quality product or service to the customer which in turn provides
increased productivity at low cost. TQM is applicable to all manufacturing and service industries. It operates on
the principle that cost of prevention is less than the cost of correction. This study focuses on TQM development,
performance and sustenance in service industries through effective communication, critical success factors and
market orientation. It examines the quality improvement through effective employee communication and the
relationship between CSFs and company performance. The study suggests Deming’s Plan-Do-Study-Act (PDSA)
cycle-based approach to develop and sustain TQM. It articulates the relationship between TQM and market
orientation, in terms of both elements (practices) and performance. The study investigates the reasons for TQM
failures and proposes guidelines for successful implementation of TQM.
Keywords - Critical Success Factors (CSFs), Effective Communication, Market Based Quality, PDSA, TQM
Failures, and TQM Implementation.
I. INTRODUCTION
TQM was introduced in mid 1980s by Edwards Deming, Joseph Juran and Kaoru Ishikawa. This
approach aims at process improvement, waste reduction, business optimization and quality performance.
Earlier empirical studies in TQM suggested that the successful implementation of TQM will result in improved
employee involvement, improved communication, increased productivity, improved customer satisfaction,
and improved competitive advantage. A strong competitive pressure has forced service industries to adopt QM
tools and techniques to offer higher quality products and services as a way to delight and keep their customers
intact. Many organizations have implemented TQM and identified CSFs for better business performance in
order to improve their position in the global market which is now become an important research area in TQM.
II. TOTAL QUALITY MANAGEMENT
TQM is characterized by its principles, practices, and strategies that emphasizes upon continuous
improvement in quality, increased involvement of employees, commitment of top management, employee
empowerment, teamwork, benchmarking, leadership, rewards and recognitions, feedback and relationship
with suppliers. TQM models prescribe several important factors: starting with effective leadership that
executes brilliant strategies, emphasizing best practices and quality improvements [1]. The factors fall into six
factors: leadership, best practices, customer focus, employee focus, community focus and productivity focus.
There are several elements of TQM that must be adopted for TQM to work.
 There must be a common quality vision.
 There must be a commitment to organize for quality.
 There must be dedication to continuous improvement.

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 Quality should be everyone's responsibility not just quality control and the CEO.
 People who work with the system know more about the system and they should be consulted when a
process is being analyzed.
2.1 TQM Practices
TQM practices can be defined as “the critical areas which an organization must accomplish to achieve
its mission by examination and categorization of their impacts”. TQM practices as shown in Fig. 1 are the
actions and processes that can be controlled by management to achieve the organizations goals and to attain
its vision. The importance of defining the TQM practices for implementation is to increase the success rate,
reduce delivery time, and prevent disillusioned state with continuous improvement programs. Better
management of TQM practices will result in improved quality and increased financial performance for the
organization.
Figure 1. TQM Practices and its impact on organizational performance.
2.2 Primary Elements Of TQM
Total quality management can be summarized as a management system for a customer-focused
organization that involves all employees in continual improvement. It uses strategy, data, and effective
communications to integrate the quality discipline into the culture and activities of the organization. These
elements as shown in Fig. 2 are considered so essential to TQM that many organizations define them, in some
format, as a set of core values and principles on which the organization is to operate.
Fig 2. Primary Elements of TQM
III. TQM In Service Industries
The growth of service industries has resulted in an increased focus on the implementation of TQM
principles in service organizations and in delivering high-quality service to customers. The growth of service
sector is due to the fact that service organizations cover a broad spectrum [2]. They interact directly with large
number of customers. With the ever increasing competitive and tough market conditions, service organizations
are concerned about their customer needs and requirements, and to satisfy them.
3.1 Understanding the Service System
Services industry can be defined as “An industry made up of companies that primarily earn revenue
by providing intangible products and services.” Service industries involve a large number of white-collar staff
working with a purpose to satisfy the varying needs of customers. The service-producing sector includes the
divisions of (1) transportation, communications, and utilities; (2) wholesale trade; (3) retail trade; (4) finance,
insurance, and real estate; (5) public administration; and (6) services which includes etc.,
Employee Satisfaction
Customer Satisfaction
Process Innovation
Product Innovation
Product Quality
TQM Practices
• Leadership
• Strategic Planning
• Customer Focus
• Process Management
• Supplier Management
• Cross-Functional Training
• Cross-Functional Product Design
• Customer Involvement
• Employee Involvement
• Empowerment and Team work
• Continous Improvement

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Other service industries include personal services like dry cleaning, hair cutting, business services like business
software developers, health care services, legal services, private education services, social services, mobile
service providers, police and security system, internet service provider, real estate, retail services, non- financial
services and many others where TQM concept can enrich the working style, service quality and performance
[3].
3.2 The Role Of Top Management
For TQM to be successful in an organization it must be actively supported by top management. If employees
are confident that top management strongly supports TQM initiative, employees become involved in the TQM
initiative. Successful employee empowerment and involvement are essential components of any TQM program.
The reason for gaining the commitment of top management to implement the TQM program is that management
has the responsibility to help employees through all the different stages of TQM. Leadership is the heart and
soul of change. Change will not occur without leadership.
Leaders must lead the pro-active change to TQM to overcome fear of change. Change to TQM demands stamina,
a spirit of entrepreneurship, endless patience, continuous communication, encouragement and recognition of
those who achieve successes along the line. It is a process that is exciting as well as dangerous. Cultural change
should be planned and should occur in a consistent and incremental manner.
To introduce TQM, an open cooperative culture has to be created by the management. Employees have to be
made to feel that they are responsible for customer satisfaction. They are not going to feel this if they are
excluded from the development of visions, strategies, and plans. It is important that they participate in these
activities for complete success of TQM implementation. The success of an organization's quality efforts relies
largely on focusing on the right objectives and its ability to communicate them to both its external and internal
customers.
4.Communication To Ensure Service Quality
Communication to the customer should clearly reflect what customers will actually receive during
service rendering and must help customers to understand their role in the service rendering process. Just like
leadership, communication plays a primary role in an organization‟s service rendering to improve service
quality. The service quality of an organization can improve by means of accurate and applicable
communication with the customer. Inadequate horizontal communication and an inclination to make promises
that are not kept, is the biggest cause of gaps between customers and organizations. This problem can be solved
and lessened by ensuring that communication with the customer does not create unnecessary expectations that
cannot be met. Internal communication between sections at the organization must be improved and
communication with the customer should focus on the quality dimensions and characteristics that are the most
important to the customer.
4.1 Supportive Dimensions For Effective Communication
4.1.1 Clear Communication
The first supportive dimension that influences the success of a TQM effort is communication. By
virtue of the supportive dimensions, communication plays a key role in the TQM effort. In order to
successfully implement TQM activities in an organization, executives must have to communicate effectively.
4.1.2 Culture forming
The third supportive dimension that influences the success of a TQM effort is culture forming. Every
organization has a unique work culture, and it is virtually impossible to achieve excellence in its products and
services unless a good quality culture has been fostered. Thus, an integrated system connects business
improvement elements in an attempt to continually improve and exceed the expectations of customers,
employees, and other stakeholders.
Culture forming is a critical success factor to implement TQM. It is essential that a thorough study
be made to determine whether the organization is ready for the implementation of TQM as it can have a major
impact on the culture of an organization. The beliefs, behaviors, norms, dominant values, rules and climate in
the organization form the culture of the organization. Any organization needs a vision framework, comprising
its guiding philosophy, core values and beliefs, purpose and mission.

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1. Effects of TQM practices on market orientation
Gaining market advantage is the objective of market orientation that is the result of responding to
changing customer needs earlier or better than competitors. A market advantage means a firm is generating
supernormal profits by getting more customers, keeping them longer, or charging higher price for the products
that are valued by the customers. Other than differentiation (pricing) and customer relationships, market
advantage can be exploited through intangible strategic assets like reputation, patents, trademarks, brand
equity, knowledge and learning orientation. Achieving market advantage is also possible by leveraging
technological.innovation, mass customization, globalization, and competitive orientation strategies such as
benchmarking, positioning and competitive objective setting.
2. Market Advantage
Customer-oriented firms should convert customer satisfaction to customer retention and loyalty and
creating customer partnership realizing that all those are important drivers to profitability. It can be postulated
that TQM companies that establish customer relationships are likely to retain customers and achieve higher
profitability. Long-term customer relationships would likely easier to create structural bonding such as joint
investment in value delivery system which create difficult-to-imitate competitive advantage hence are likely
sustainable. Market advantage in terms of customer oriented strategies mean that firms can improve customer
retention rate thus lead to substantial improvement in profits.
IV. Sustaining TQM
Sustainability is defined as „the ability of an organization to adapt to change in the business
environment to capture contemporary best practice methods and to achieve and maintain superior competitive
performance‟. Sustainability is described as the development that meets present needs without compromising
the ability of future generations to meet their own needs. Without sustainability, there is little benefit to be
gained from TQM.
4.1 PDSA Cycle For Sustainable Development Of TQM
This paper suggests Deming‟s Plan-Do-Study-Act (PDSA) cycle based approach to develop and sustain TQM.
This approach is unique and can be customized to suit the organisation requirements [8]. The results will help
the top management in setting out priorities to achieve sustained growth of TQM process. The PDSA cycle
suggested for TQM sustainability consists of four steps:
 Step-1: Plan for TQM - The adoption of TQM in an organization has to start from a strategy for
implementation involving the planning and preparation of document detailing the way forward. The
preparation of such a document may constitute: (1) Creation of a TQM co-ordination body; (2)
Development of a vision, mission and policy statements; (3) Education for the top management and
coordinating body members on total quality principles and philosophy; (4) Selection and trial run of the
first improvement project; and (5) Appraising the company‟s current level of quality management
implementation.
 Step-2: Implement TQM.
 Step-3: Study and measure the level of implementation ofTQM.
 Step-4: Take necessary actions to improve the less developed programs ofTQM.
V. GUIDELINES TO EFFECTIVE TQM IMPLEMENTATION
Successful implementation of TQM program in service organization can be achieved by adopting a
set of TQM practices and developing a model or framework based on these practices to get maximum benefits
and desired outcome. The set of practices chosen depends upon the nature and characteristics of the service
organization which is responsible for successful implementation of TQM program. For effective
implementation of TQM and better results, following ten basic steps are identified.
 Adoption of state-of-art and advanced technologies instead of following traditional culture by the top-
management in the organization. Thus, top-management commitment is crucial to success.
 Set the objectives or goals by involving employees at all levels and define them. This will act as the
indicators of success in terms of mission.

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 Developing quality awareness, imparting training and education on the principles and core concept of
TQM to the employees, changing their attitudes and mind set towards quality culture, and commitment
of never ending the continuous improvement and innovation in the organization.
 Develop and document the approach to TQM and make sure that it is being practiced in the
organizations and should not remain on papers only.
 Identify the key TQM practices for the organization and create an environment to implement and
restrain them by force.
Without a strategy to implement TQM the effort will lead to frustration of employee and thus, leads
to the total failure of the TQM implementation [9]. Therefore, all the employees should have prior knowledge
of TQM and must be educated and trained before TQM is initiated for implementation. Implementation of
TQM
Fig 3. Effect of Organization support and Co-worker support on TQM implementation
V. TQM FAILURES AND SYMPTOMS
Many organizations have been using TQM to improve performance and they are quite successful in
implementing it, there are also some cases where organizations have failed to reap the benefits of TQM due to
their different focus in its implementation. Results do not always come quickly. It is generally acknowledge
that the longer organizations work at TQM, the more successful they will be. Two to three years into
implementation have been quoted in the literature as the period after which some tangible benefits of TQM
are more likely to be evident [10]. The success of implementing TQM in an organization is ultimately judged
by its customers.
VI. DISCUSSION
5.1 Theoretical Implications
This study examined the TQM development, performance and sustenance in service industries
through effective communication, critical success factors and market orientation. This study also found that
an environment of support within the organization enhances the effectiveness of TQM implementation [11].
More specifically, organization support that encourages a positive reciprocal relationship between employees
and their organizations, and strong collegial support that promotes sharing knowledge in an encouraging,
supportive manner produce a synergistic effect on the TQM/performance relationship.
5.2 Managerial Implications
This study has important implications for managers. First, it motivates managers (and provides a
justification) to invest in the time and resources to implement TQM programs. Based on the results of this
study, the implementation of TQM practices is associated with enhanced organization performance.
Second, this study signals the importance of ensuring a supportive organizational environment for the
effective implementation of TQM. The study suggests that organizations should develop an environment or
“culture” of support, which includes fostering support among co-workers, for the effective implementation of
TQM. If employees do not feel there is sufficient acknowledgement and support from the organization and
from colleagues with whom they work, then firms may not reap the benefits of TQM programs.
and hence, increased customer satisfaction.

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VII. CONCLUSION
The study emphasizes the importance of implementing a comprehensive TQM program. It is more
systematic in explaining the fundamentals and components of TQM. The study covered theory, concepts of
TQM, its practices, service system together with the reasons of TQM failures, and approach to TQM
implementation. This study makes a real contribution in:
 understanding the service system and the reasons for its growth;
 understanding TQM in service organization and its impact;
 understanding the role of TQM practices in service organizations;
 Knowing what causes „TQM failure‟?
 Understanding how TQM can effectively be implemented for better result?
From the study, it is also concluded that organizations that want to implement TQM effectively must
have patience because TQM takes a long time to get implemented and to have fruitful results. It requires major
changes in cultural aspects as well as employee mindset in an organization. This study will help service
managers in better understanding of TQM and service quality concept, and their implementation in their
organizations by considering the top-management commitment and customer focus as most important
principles for service organizations. It will also help them to motivate and create a vision for the change.
REFERENCES
[1]. E. Allen and R. Brady, “Total quality management, organisational commitment, perceived organisational support and
intraorganisational communication”, Management Communication Quarterly, 10(3), 1997, 316-41.
[2]. S. A. Brah, J. L. Wong and B. M. Rao, TQM and business performance in the service sector, International Journal of
Operations and Production Management, 20(11), 2000, 1293-1312.
[3]. F. Talib. et al., Total Quality Management in Service Sector: A Literature Review, International Journal of Business Innovation
and Research, 6(3), 2012, 259-301.
[4]. D.C. Barnlund, A transactional model of communication (Boston, MA: Pearson Education, Inc.,
2008) [5]. Roy M. Berko, et al., Communicating (Boston, MA: Pearson Education, Inc., 2010)
[6]. A. Seetharaman, et al., Critical Success Factors of Total Quality Management (Boston, MA: Pearson Education, Inc.,2006)
[7]. C. Narver John and F. Slater, “The Effect of a Market Orientation on Business Profitability,” Journal of Marketing, 54 (10),
1990, 20-35.
[8]. M. A. Idris and M. Zairi, Sustaining TQM: A Synthesis of Literature and Proposed Research Framework, Total Quality
Management & Business Excellence, 17(9), 2006, 1245–1260.
[9]. R.P. Mohanty and R.P. Lakme, Factors affecting TQM implementation: An empirical study in Indian Industry, Production
planning & control, 9(5), 1998, 511– 520.

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A Study on TQM Development, Performance and Sustenance in Service Industries through Effective Communication, Critical Success Factors and Market Orientation